All Forum Posts by: Phil Avery

I do think people get too caught up in the property type and area as opposed to the math that is involved. You're right, it's gotten a lot harder in the last 18 months. Not only did interest rates make the P&I payments on a property much more expensive vs rental growth, but taxes and insurance have risen as well making a lot of properties not cash flow. Many of the investors we work with have started putting a lot more down on the properties to keep payments lower, thereby making the properties cash flow. Other's are buying properties that needs some TLC that they feel they can get at a discount to fix and rent. In your case, it doesn't sound like that's going to work for you. Keep in mind that as you sift through the haystack looking for the needle, so is 90% of the people on Bigger Pockets and everyone on every RE Facebook Group. It is hard, but every market will have their bad and good deals. 

Zillow is now offering a loan program which allows home buyers to buy a house with as little as 1% down.

Looks like this product is a regular conventional loan where the buyer will bring 1% of the down payment, and Zillow will contribute the remaining 2% of the down payment (handled through closing, not as a direct payment to buyer).

As far as I can tell this down payment assistance will not ever need to be repaid. The only catch is that the borrower needs to be a first time home buyer, they need a minimum 620 FICO, and they need to complete an online education course. Also, at this time this is only offered to buyers in Arizona, but they plan to expand to other states soon.

Seems like a great option for first time buyers. What do you guys think?

Link to Press Release

Hey! I'm a wholesaler in Houston, TX mainly wholesaling land. Would love to connect! 

Hey guys,

So here’s the situation, the seller agreed to 75 down for his building under sub to. While talking on the phone he asked when he was going to get the rest of the money he put in the property, after I refinance. I let him know that’s not really how it works and that 75k is what’s getting him out of the deal. He said he wasn’t interested anymore. Is there any way I can get around this where where the owner is still happy and I’m still giving him 75k down or less? Could the bank when I refi just give him his money? 
thanks 

Best advice: House hack. Utilize an FHA loan and get into a property that you can use to help pay for your mortgage. Wait a few years, build that equity then rent out that property and do the process all over again. If I could go back in time, this is the strategy I would be doing. If you need any advice or guidance, my husband and I are both on the ground helping a ton of investors. We are available to help answer any questions you might have!

I think you could also look at conventional 3% down if you have below the 80% AMI, you would qualify for lower rates and lower PMI! So always a good option.

I know I just helped one of my clients that had 15K saved and got into a duplex for that 15K roughly and had sellers pay the closing cost. Now renting the other unit to pay her mortgage! LIVING Free!!! 

I think it's great you're trying to figure out what to do though. In Houston could be a little tough, but some of the surrounding areas like Pasadena or Sugarland outskirts definitely are great rental areas.

@Phil Avery nice break down, okay here are my thoughts:

1. If it's that pressing to move and you are still serious about investing, then yes, I would aim for a property that you could would meet 80% of what you want in a home and that would still meet your investment property criteria (most of your home criteria will likely overlap those for a rental too, BUT not all) - I don't prefer this option

2. I like this option best out of all the ones here because it give the most options with the most immediate impact: A) You can move in one side or continue renting (depending on your rent vs. your rental unit's rent) ; B) You can still attain 'normal' financing with favorable terms i.e. FHA ; C) If you live in it you can 'monitor' and 'go to school' learning the ropes of your investment; D) If you don't live in it you'll have more cashflow

3. SFR's are 'king' in the 1-4 space meaning that almost everyone will seek to attain or move towards an SFR - tenants included, they are more stable and they are also much easier to exit as compared to a duplex while still holding value for ex. you would sell an SFR to an owner occupier whereas 2-4 units you would sell to someone that is trying to be savy and possibly hammer your down on price. Also SFR's can be treated like a portfolio of multiple to units to mimic 2-4 units - HOWEVER, it still think a duplex, or 2-4 unit for YOUR situation is still best at this moment, because it does allow you check off almost all of your personal, financial and investment boxes.

4. Yeah you should keep your eye out for it but you should also pursue other routes the danger with this one is that you will just keep spinning your wheels while not getting anywhere as you watch the world pass you by.

5. Nope, don't hold off... time in the market ALWAYS beats timing the market, I know it's cliche but I have lived it and its so true. Go back two years and some people would prob tell to 'hold off' until covid rent restrictions real estate keeps plummeting, then 'hold off' until the market cools prices are going up, then 'hold off' rates are going up..... buy now, screen your property and ensure it cashflows and don't look back.

6. Same as #3 and #4 - still prefer 2-4 unit option. 

I hope this helps. 

@Phil Avery I'm originally from Houston but currently live in San Diego. I've done a lot of out-of-state investing (Florida, Oklahoma, and Wisconsin) and I'm happy to jump on a call and see if theres a way I can provide value to you. My calendly link is on my profile.